A Bumper Crop of Bureaucracy
Author:
Richard Truscott
2001/03/12
Bureaucrats, not farmers have turned out to be the biggest beneficiaries of the Agriculture Income Disaster Assistance program (AIDA). AIDA has not just been a failure, it has been a very expensive failure.
According to information obtained by the Canadian Taxpayers Federation (CTF) the total administration costs for AIDA may be more than three times higher than originally budgeted by the time the program ends at the end of March.
The total cost of administering the program nation-wide was originally projected to be $30 million over two years. Instead, AIDA has cost $48 million to administer in just five provinces (Saskatchewan, Manitoba, New Brunswick, Newfoundland, and Nova Scotia) over the same period. The total bill, however, will probably be over $50 million before the program winds down at the end of this month.
In the other five provinces (Ontario, Quebec, Alberta, PEI, and British Columbia) the provincial governments operate their own AIDA administration under separate cost sharing arrangements with the federal government.
From the outset, the federal government stated it was allocating 3% of the AIDA budget to cover administration costs. But these costs in the five provinces where the feds run the program are now 14% of the total value of AIDA payments. If costs are similar in the other five provinces that run the AIDA program themselves, the Canada-wide administration cost could easily exceed $100 million.
As for a breakdown, the costs for the five provinces where AIDA is federally-run include $26,369,159 for salaries and benefits, $810,934 for travel, $756,703 for temporary help and students, and $2,711,651 for consultants. Clearly, AIDA was a very complicated program that resulted in unnecessarily high personnel and consulting costs.
Other big costs include $1,222,793 for the repair and maintenance of buildings, $599,180 for repair and maintenance of equipment, and $656,626 for rentals. There is also a $6,293,643 bill for materials and supplies.
AIDA was replaced last year by the Canadian Farm Income Program. We shouldn't hold out breath that the government has learned from AIDA's mistakes.
So what's the problem with AIDA Like most bureaucracies, it seems to a bigger part of the problem than part of the solution. Instead of actually helping farmers deal with the high cost of farming, the government has been forcing them to navigate a costly maze in the vain hope of a piece of cheese at the other end. There are many real stories of farmers spending hundreds of dollars and dozens of hours filling out AIDA application forms only to discover they are eligible for a couple of loonies.
No doubt, the solution to farm income problems may depend on an end to the subsidy war between the Subsidy Superpowers and the recovery of world commodity prices. If governments really wanted to make farming more viable and help farmers deal with rising fixed costs, they need to reduce income-insensitive taxes like school taxes.
Governments can also make life on the farm a lot easier if they fixed the other problems created in our legislatures, including costly and ineffective farm programs. AIDA has had little impact on the farm crisis, but it certainly has grown a bumper crop of bureaucracy.